State v. Forsyth
| Decision Date | 27 January 1982 |
| Docket Number | No. 16636,16636 |
| Citation | 641 P.2d 1172 |
| Parties | STATE of Utah, Plaintiff and Respondent, v. William Louis FORSYTH, Defendant and Appellant. |
| Court | Utah Supreme Court |
David L. Wilkinson, Atty. Gen., Robert R. Wallace, Asst. Atty. Gen., Salt Lake City, for defendant and appellant.
Stephen R. Madsen, Provo, for plaintiff and respondent.
This is an appeal from a jury conviction on four counts of theft by deception in violation of U.C.A., 1953, § 76-6-405, as amended. 1 Defendant was sentenced to 1-15 years on each count, sentences to run concurrently. The only issue defendant urges on appeal is that it was prejudicial error to admit the testimony of ten investors other than the four alleged victims. We affirm the conviction.
Viewing the evidence in the light most favorable to the jury's verdict, State v. Gorlick, Utah, 605 P.2d 761 (1979), the relevant facts against which the alleged error must be judged are as follows. (Defendant makes no separate contention that the evidence was insufficient for the jury to find him guilty-only that the jury was prejudiced in its deliberations by the testimony of the other investors.)
From May, 1973, through July, 1974, defendant, who was organizer and president of Great Outdoors, Inc. (hereafter "the corporation"), solicited persons to invest in that corporation to provide capital for the development of two health spas in Orem. In March through June, 1974, when the four victims invested, the minispa, at 1250 South 350 East, was under construction and was to be completed with the investors' funds and put into operation within a few months. Sales of memberships in that spa were then to provide funds for the construction of the large "Sportsman's Spa" at 250 West Center, where footings had been poured but where no other construction was yet underway.
After personal conversations with the defendant, each of the four victims, Turley, DeHoyos, Uzelac and Broadbent, signed an agreement by which he invested $5,000 in the corporation (in the case of DeHoyos, $3,000 plus agreed services). In this agreement, the corporation, by the signature of defendant, its president, agreed that each investor of $5,000 would have 10,000 shares of stock and a lifetime family membership in the Sportsman's Spa without membership or monthly dues. The corporation also agreed "to refund all monies invested by INVESTOR on or before twelve months from the date of this agreement, from receipts from membership sales in the Sportsman's Spa ...." 2 Each investor paid the agreed amount at the time the agreement was signed. No monies were ever refunded, and no memberships were ever granted.
As is evident from the formal charges, the jury instructions, and the closing arguments, the prosecution contended that the defendant committed deception by false representations of fact and by promising to refund the victims' investments within the promised period of time (or from the membership proceeds) when he in fact had no intention of doing so. Misrepresentations to all four victims concerned (1) the corporation's or defendant's ownership of real estate to secure the investor's investments; (2) the total amount being raised for the development of the spas; and (3) the total number of investors being sought. These subjects are treated below. In addition, defendant represented to some of the victims that the financial soundness of the spa venture and the attractiveness of their investment would be enhanced by future revenues from the corporation's ownership of a nearly completed spa in Florida, of a chain of campgrounds in the western United States and Mexico (Great Outdoors Systems), of a real estate holding company (Build Estate), and of an investment organization (Eagle International).
All four of the victims testified that a material consideration in making their investment was defendant's representation that he or the corporation "owned" the property at 250 West Center (where the large spa would be constructed), which would provide security for the promised refund of their investments. DeHoyos testified that defendant told him he owned the land "all clear." Turley testified that defendant told him he "owned" the property and although he was indebted for about $50,000 thereon there was plenty of equity to guarantee the refund of Turley's money in a year's time since the property was worth about $240,000. Broadbent and Uzelac each testified that defendant told him he (or the corporation) "owned" the property and that it would provide adequate security for the return of the investment monies in a year in the event of any problems. Both testified that by this statement they understood defendant to be saying that the land was "paid for" or "free and clear." In contrast, there was uncontroverted evidence at trial that defendant was buying the 250 West Center property on contract, and had then paid, in addition to interest, only $34,000 of the total purchase price of $109,000. There was also evidence from which the jury could have concluded that the subject property was then worth less than $125,000.
All four of the victims testified that defendant told them at or just before the time of their investment that to complete the planned development of the two spas the corporation needed only a total of $50,000 of invested capital, which was being provided by only ten investors. In May, 1974, DeHoyos and Uzelac were told that they were numbers seven and eight, respectively. In June, Broadbent was told that he was the last or second-to-last of the ten. These investors indicated that the defendant's representations about the amount needed, the number of investors, and their own sequence were important to their decision to invest. In contrast, it appeared from other evidence (apparently without contradiction) that in this period defendant obtained investments in the corporation totalling approximately $180,000, and that at least fourteen persons invested. It also appeared that, at the time defendant represented to the victims that only $50,000 of invested capital was needed to complete the spa ventures, the minispa was still incomplete with sums overdue for ongoing construction, the corporation was in default on the real estate contract under which it was purchasing the 250 West Center property, and at least $63,000 was overdue on various corporation contracts including over $30,000 in refunds promised in the contracts of the earliest investors.
Apparently believed by the jury, the foregoing evidence was sufficient to sustain the jury's verdict of guilt on all four counts.
In addition to the testimony of the four victims, the prosecution's case included the testimony of ten other investors. The admissibility and possible prejudicial effect of their testimony is the sole issue defendant contests on this appeal.
Defendant characterizes the other investors as a prejudicial parade of witnesses whose testimony did not come within the exceptions of Rule 55 of the Utah Rules of Evidence because, instead of giving evidence of misrepresentations by the defendant, these witnesses merely recited their complaints about not obtaining the agreed refund of their own investments. The trial court admitted the other investors' testimony to show the defendant's pattern, scheme, or design. The state supports that action by arguing that "the testimony of the other investors reveals substantial relevant misrepresentations made by the defendant in perpetration of a common plan or scheme," which was therefore admissible under Rule 55.
Rule 55 of the Utah Rules of Evidence, whose full text appears in the footnote, 3 has syntax at odds with its substance. Its syntax suggests a general rule followed by exceptions, but an examination of its substance reveals an exception followed by a general rule followed by illustrations.
Rule 55 begins by specifying the one purpose for which "other crime evidence" cannot be admitted-to prove criminal disposition as a basis for an inference of guilt of another crime. 4 The text then states the general rule that "subject to Rules 45 and 48, such evidence is admissible when relevant to prove some other material fact including" those listed. The term including indicates that the list is illustrative, not exhaustive. Thus, Rule 55 provides that, subject to Rules 45 and 48, "other crime evidence" is admissible when relevant to prove any material fact, including those listed, but not including criminal disposition as the basis for an inference that the defendant committed another crime on another occasion.
Unless Rules 45 or 48 dictate or permit a contrary result, 5 the admissibility of evidence that a defendant committed some other crime or civil wrong turns on whether that evidence is "relevant to prove some ... material fact" in the crime or charge on trial. This is the approach specified in Rule 311 of the American Law Institute's Model Code of Evidence (1942), in Rule 404(b) of the Federal Rules of Evidence Manual (2d ed. S. Saltzburg & K. Redden, 1977), and in 1 Wigmore on Evidence §§ 190-94, 216 (3d ed. 1940). It is also the rule established in the better-reasoned opinions of this Court. See, generally, R. Boyce, "Evidence of Other Crimes or Wrongdoing," 5 Utah Bar Journal 31 (1977).
In State v. Harries, 118 Utah 260, 283-84, 221 P.2d 605, 617 (1950), which affirmed a conviction based partly on other-crime evidence showing a public official's plan or scheme in the receipt of a bribe to overlook violations, this Court declared:
Any pertinent fact which throws light upon the subject under judicial consideration, the accused's guilt or innocence of the crime for which he is charged, is admissible. Such fact is not to be excluded merely because it may also prove or tend to prove that the accused has committed another similar crime. Relevant and material evidence does not become irrelevant or immaterial merely because it points...
To continue reading
Request your trial
-
State v. Bishop
...218-19 (citations omitted). Justice Stewart expressed the same sentiments in his scholarly concurrence in State v. Forsyth, 641 P.2d 1172, 1177-79 (Utah 1982) (Stewart, J., concurring) (cited with approval in State v. Saunders, 699 P.2d 738, 741 n. 17 (Utah 1985), and followed without citat......
-
State v. Lafferty
...State v. Long, 721 P.2d 483, 495 (Utah 1986); State v. Saunders, 699 P.2d 738, 741 (Utah 1985) (citing State v. Forsyth, 641 P.2d 1172, 1177-79 (Utah 1982) (Stewart, J., concurring)); State v. Holder, 694 P.2d 583, 584-85 (Utah 1984); People of the Territory of Utah v. Coughlin, 13 Utah 58,......
-
State v. Gardner
...to Rule 404(b) to prove motive, intent, identity, and other material issues under certain circumstances. See, e.g., State v. Forsyth, 641 P.2d 1172 (Utah 1982). There may even be instances when a defendant chooses to adduce prior crime evidence, for example, to establish an alibi by showing......
-
State v. Taylor
...or manner of operation is admitted where it tends to prove some fact material to the crime charged." 5 Id. (quoting State v. Forsyth, 641 P.2d 1172, 1176-77 (Utah 1982)). In sum, "[w]hen evidence may establish constitutive elements of the crime of which the defendant is accused, in the case......
-
State v. Teuscher: the "exception" Swallows the Rule
...v. Johnson, 748 P.2d 1069, 1074 (Utah 1987). [6] See text accompanying footnotes 3 and 4, Reed, supra, at 713-14. [7] State v. Forsyth, 641 P.2d 1172, 1179 (Utah 1982) (Stewart, J., concurring). [8] See id. [9] Let us assume that on appeal Teuscher had challenged the sufficiency of the stat......